Author: Chris Kodo

The coronavirus outbreak, which originated in China, has infected tens of thousands of people. Its spread has left businesses around the world counting costs.

Here are eight key maps and charts to help you understand the impact seen on different economies and industries so far.
Growth could stagnate

If the economy is growing, that generally means more wealth and more new jobs.

It’s measured by looking at the percentage change in gross domestic product, or the value of goods and services produced, typically over three months or a year.

The world’s economy could grow at its slowest rate since 2009 this year due to the coronavirus outbreak, according to the Organisation for Economic Cooperation and Development (OECD).

The think tank has forecast growth of just 2.4% in 2020, down from 2.9% in November.

It also said that a “longer lasting and more intensive” outbreak could halve growth to 1.5% in 2020 as factories suspend their activity and workers stay at home to try to contain the virus.

Global shares take a hit

Investors have been worried about the impact of the coronavirus as it spreads outside of China.

Big shifts in stock markets, where shares in companies are bought and sold, can affect investments in some types of pension or individual savings accounts (Isas).

The last week of February saw the worst performance for major stock markets since the 2008 financial crisis.

European and US stock markets have seen a slight uptick since then as it’s hoped that countries will intervene to protect economies from the coronavirus outbreak.

The US central bank, for example, slashed interest rates in response to mounting concerns. That should, in theory, make borrowing cheaper and encourage spending to boost the economy.

Factories slowing down

China makes up a third of manufacturing globally, and is the world’s largest exporter of goods.

But activity has decreased in the so-called “workshop of the world” as factories pause their operations to try to contain the spread of Covid-19.

Nasa said pollution-monitoring satellites had detected a significant drop in nitrogen dioxide over the country. Evidence suggests that’s “at least partly” due to the economic slowdown caused by the outbreak.

Restrictions have affected the supply chains of big companies such as Diageo, JCB and Nissan, who rely on China’s production and its 300 million migrant workers. Jaguar Land Rover even said it had flown car parts in suitcases as some factories run out of parts for vehicles.

Customers buying less

Fear of the coronavirus outbreak means that some people are choosing to avoid activities that might expose them to the risk of infection, such as going out shopping.

Restaurants, car dealerships and shops have all reported a fall in customer demand.

Chinese car sales, for example, dropped by 92% during the first half of February. More carmakers, like Tesla or Geely, are now selling cars online as customers stay away from showrooms.

Shipments of smartphones are also expected to take a big hit in the first half of 2020, before seeing a recovery later on.

Apple was one tech giant who said sales had been affected by low customer demand.

Travel among hardest hit

The number of cases diagnosed is increasing around the world every day. Many countries have introduced travel restrictions to try to contain the virus’s spread.

For example, the UK government advises against all travel to the Hubei province in China, where the virus originated. It’s also issued special travel advice for Italy, which was the first European country to report a major surge in cases.

The travel industry has been massively impacted, with airlines cutting flights and tourists cancelling business trips and holidays.

Data from analytics firm ForwardKeys shows international flights booked from China are behind by 55.9% in comparison with the same period in 2019.

UK travel industry experts have expressed concerns about Chinese tourists being kept at home. There were 415,000 visits from China to the UK in the 12 months to September 2019, according to VisitBritain. Chinese travellers also spend three times more on an average visit to the UK at £1,680 each.

As more large-scale events are cancelled and the number of flight cancellations increases, there are fears the industry could take a bigger hit.

Some bright spots

It can be hard to find positives when people’s jobs are affected, or – as in the case of the coronavirus outbreak – lives are being lost.

But in purely business terms, there are some bright spots. Consumer goods giant Reckitt Benckiser, for example, has seen a boost in sales for its Dettol and Lysol products.

The disinfectant is seen as providing protection against the spread of the disease, although its effectiveness has not yet been scientifically proven.

The price of gold – which is often considered a “safe haven” in times of uncertainty – has also increased. Its spot price hit a seven-year high of $1,682.35 per ounce in February.

Investors are looking to it amid fears the coronavirus spread outside of China will further hit the global economy and demand.

Source: bbc.com

Almost 300 million students worldwide faced weeks at home on Thursday with Italy the latest country to shut schools over the deadly new coronavirus, as the IMF urged an all-out, global offensive against the epidemic.

More than 95,000 people have been infected and over 3,200 have died worldwide from the virus, which has now reached some 80 countries and territories.

The vast majority of global deaths and infections are in China, where the virus first emerged late last year, prompting the country to quarantine entire cities, temporarily shut factories and close schools indefinitely.

As the virus spread, other countries have also implemented extraordinary measures, with UNESCO saying Wednesday that 13 countries have closed schools, affecting 290.5 million children, while nine others have implemented localised closures.

While temporary school closures during crises are not new, UNESCO chief Audrey Azoulay said, “the global scale and speed of the current educational disruption is unparalleled and, if prolonged, could threaten the right to education.”

Italy on Wednesday ordered schools and universities shuttered until March 15, ramping up its response as the national death toll rose to 107, the deadliest outbreak outside China.

South Korea — the country with the largest number of cases outside China with nearly 6,000 — has postponed the start of the current term until March 23.

In Japan, nearly all schools are closed after Prime Minister Shinzo Abe called for classes to be cancelled through March and spring break, slated for late March through early April.

Some 120 schools closed in France this week in areas with the largest numbers of infections.

Economic threat

The German health minister said the outbreak was now a “global pandemic” — a term the World Health Organization has stopped short of using, meaning the virus is spreading in several regions through local transmission.

Infections are now rising faster abroad than they are in China, where 31 more deaths and 139 new cases were reported Thursday. China’s death toll now stands at 3,012, with over 80,000 infections.

From western Europe to eastern Asia, supermarket shelves have been stripped of supplies in recent weeks, including toilet paper and hand sanitiser.

American businesses are increasingly concerned over access to goods and the overall economic outlook is more uncertain, the US Federal Reserve said in its beige book survey released on Wednesday.

With the US toll rising to 11 on Wednesday, lawmakers in Congress reached a deal to provide more than $8 billion to fight the outbreak.

The virus impact has spread beyond supply chains — stock markets have rumbled as warnings from financial bodies mount that countries could be pushed into recession.

The IMF said the epidemic posed a “serious threat” and would slow global growth to below last year’s 2.9 percent.

“At a time of uncertainty… it is better to do more than to do not enough,” IMF chief Kristalina Georgieva said.

The epidemic “is a global problem calling for global response,” she said.

Eurozone ministers agreed after a meeting that they were ready to “use all appropriate policy tools to achieve strong, sustainable growth”.

No kissing

As the virus continues its march across the world, governments are scrambling to tighten prevention efforts.

Italy has seen its outbreak swell despite tough measures, including a quarantine of 11 towns with 50,000 people.

New measures include a month-long nationwide ban on fan attendance at sports events, as well as advising people to avoid greetings like kissing on the cheek or shaking hands.

Prime Minister Giuseppe Conti said the country could tackle the outbreak as long as it remained contained.

“But in case of exponential growth, not just Italy but any other country in the world would not be able to manage the situation,” he said.

In Iran, where 92 people have died from the disease, schools have been shut and major cultural and sporting events suspended.

Saudi Arabia has suspended the year-round “umrah” pilgrimage, an unprecedented move that raises fresh uncertainty over the annual hajj.

Countries also continue to crack down on international travel.

Even cinemagoers were not immune from the effects of the virus — the producers of the latest James Bond film pushed back the release of the forthcoming “No Time To Die” from April to November.

Source: AFP